How to prevent the App Store from becoming the Crap Store

Apple’s iPhone App Store has undoubtedly been a huge success so far. We’ve had great fortune with not one but two hit apps. But we’re getting to the point where the App Store is in jeopardy of getting destroyed because it’s being overrun with 99¢ shovelware, with an ever growing number of developers competing for a slot in the charts.

Some developers have been up-in-arms over this in recent days and the “shakeout” that they believe is on the horizon is pretty much a pipe-dream. It’s just not going to happen. Higher-priced apps aren’t going to rise and dominate the charts, even if they trounce the competition in quality. Very strong precedents have been set regarding what the market expects for pricing and it’s low.

But 99¢ doesn’t have to be the only option for getting exposure for your apps. The important thing to consider is that it’ll likely be impossible to change the current situation unless some reform comes from above.

iPhone apps aren’t Mac apps

If you develop your iPhone app as if it’s a Mac app (or Windows, Linux, etc… desktop app for short), it’ll be doomed to failure. Apple’s pretty explicit about what to do and what not to do when creating iPhone apps and the rules are very different compared to the desktop. This is well documented in the iPhone Human Interface Guidelines. Developers seem to grasp this concept just fine, for the most part.

Similarly, if you position and market your iPhone app as if it’s a desktop app, it’ll also be doomed. Again, the rules are very different here. But it seems like developers are jumping into this with outdated and inappropriate notions. Mobile markets in general are completely different from desktop markets and this is even more so with the iPhone.

And now the problem we’re starting to see is that many developers who’ve had success in the desktop realm are becoming very frustrated when their inability to repeat their successes in the iPhone marketplace. This is understandable, but the so-called solutions that are being proposed will most likely have the opposite effect than intended.

Thinking and acting like a “traditional” software developer simply doesn’t cut it in the App Store and this will almost certainly lead to failure, especially as the App Store matures. Granted, there’s still room for some traditional developers to exist in this market but success will probably be very, very limited and is more likely to happen in more niche and vertical markets.

Understand the rules before you try to break them

The App Store is very hit-driven. Almost all of the sales from the store are driven by the apps in the Top 100 chart. Once your app falls off the chart (assuming you were fortunate to have it on it in the first place), it’s typically a matter of days before your sales numbers shrink down into the teens or even single-digit numbers.

Most App Store purchases fulfills the need of instant gratification, not traditional “need”, especially when that gratification can be had for a buck or two. How many times have you seen an app in the App Store and it was a no-brainer to just tap the “Buy Now” button because the risk was so low? It’s a crap-shoot and sometimes your gamble works out… sometimes it doesn’t. When it’s only a buck or two at stake the buyer’s remorse factor is minimal. Desktop apps don’t have this benefit, where they’re typically sold for $20 and up so impulse buys there are nowhere near as frequent as with iPhone apps.

“The fix for pricing too low is really simple: raise your prices. Most $0.99 apps should become $9.99, $4.99 apps should become $14.99, and so on. With a $9.99 app, you’d make $7 per copy and at 16 copies per day, you’d make about $40,000/year.”

A bunch of others (mostly developers) rallied around his cries. Now we hate to sound negative here, but arbitrarily suggesting that everyone up their app prices by around $10 just isn’t going to cut it here. How can one assume that charging more for an app will keep sales numbers the same, or even anywhere close to the same? The reality, because of the way the App Store currently works, is that taking this step will almost definitely drive you to obscurity about as fast as it takes your grandma to make the next great flashlight app.

iPhone apps are typically much smaller and more focused than desktop apps and as such, should be priced accordingly. In addition, you need to take into account the much larger market that you’re dealing with here… Apple is selling well over 10,000 iPhones per day and these are all potential new customers, plus all the existing iPhone owners and iPod touch sales.

This dollar store mentality even goes beyond the iPhone as most of the Mac developers we know have been experiencing significant downward trends in their software sales since the App Store opened. It appears that the “instant-gratification-on-the-cheap” factor has implications on the desktop, too. It’s going to be tough to compete with impulse purchases when you can get around 20 iPhone apps for what a typical desktop app costs.

Due to the direct relationship between an app’s chart ranking and the numbers of copies sold each day, developers on the store have given up the notion of a price as a marker of valuation, and now simply use the price as a means of competition and marketing, rather than as a cost relative to the value of their application. This is not against the rules. This is an expected reaction from iPhone developers to some inherent flaws in how the charts, and to a large part, the entire App Store works. Of course, the inevitable endpoint of this ongoing trend is the average price of any popular apps eventually flatline near 99¢.

The way things are going, it’s hard not to predict a future that is bright only for the small-scale, cheap apps that manage to hit it big. Where no one is crazy enough to dedicate the money, talent, or time on something truly exceptional. Where the shelves are lined with questionable chocolate bars and trinkets. It’s the future of the Crap Store.

And the hard reality is that the market is currently very hostile to anyone who tries to fight it.

But before everyone starts panicking, we think there’s a simple solution…

The fix

Instead of basing app rank on the number of units sold, base it on on gross revenues.

This model has worked at the box office for ages, and it’s even more appropriate in this situation since there’s a much wider range in app prices versus movie ticket prices.

Because the playing field in the App Store is currently skewed towards the cheapest offerings, unlike how it works in other “chart-centric” industries, this solution would take a lot of the pressure off of developers to keep trying to undercut each other. Developers who’ve been put off by the current atmosphere of the App Store would likely be giving things another look which means that we’d have a better chance of seeing higher quality titles come to the store. Everyone wins… well, except the shovelware creators and I’m sure few will miss them.

Think about this simple scenario for a second and it should immediately make sense to you… take an app that’s priced at 99¢ and is selling 1,000 units a day compared to an app priced at $19.99 and selling 999 copies per day. The way the App Store currently works, the 99¢ app would still be ranked higher than the $19.99 app, even though the $19.99 app would be earning over 20 times as much as the 99¢ one!

The charts as they are work as a simple measure of popularity in terms of number of customers. This would be fine, but as the only truly viable method of exposure offered to most iPhone developers, we think a chart based on how well apps are doing would at least allow for further price diversity and pricing that is more in line with a valuation of the product.

What’s important to consider here is that we’re absolutely not suggesting that we feel that there’s no room for 99¢ apps in the store. We have no problem with discounted software. The issue is that the current situation punishes most who feel that their apps are worth more than 99¢, while rewarding those at 99¢. And this shouldn’t be the case. The App Store is in danger of becoming the Crapware Dollar Store if something isn’t done to change the way it’s setup now. Our proposed fix would go a long way toward remedying this.

It’s worth pointing out that Apple doesn’t make public the criteria for how the apps in the App Store are ranked, but our data strongly suggests that what we’re presenting here is the way it works.

Also, bear in mind that what we’re discussing here pertains only to the 99¢ issue. Other issues like exposure for apps that aren’t in the charts, etc. are entirely separate issues.

The Curse of 12

We debated for months about how to price Classics. But as we watched countless apps make anemic chart climbs and quickly shuffle off the charts, our initial thoughts of a $9.99 price tag fell, and fell, and we eventually settled on $2.99. Did we price it below what we felt our app was valued? Yes. But we had two things in mind – reaching as many users as we could with what we felt was a pretty cool piece of software, while at the same time paying the rent check.

We held the $2.99 price for about two weeks, through Classics’s first run at the charts. Over the next week or so, the app burst into the charts at position #54 and rocketed upwards. The coveted top ten was in reach. Over the first two weeks, the app sold over 20,000 copies, grossing in excess of $60,000.

But then, something happened. iHunt, at 99¢ rocketed past Classics to #1. Then Wings, at an intro price of 99¢, and so on. After inching to position #12, Classics began to drop, slowly at first, but slipping faster and faster by the day, until we were just about to shuffle off the charts at a low of #92.

The reason that we’re noting the #12 rank is because it’s exactly the rank that our other hit app, Where To, peaked at in its first climb up the charts. And the same happened with fellow developer, Austin Sarner and his Pennies app. Definitely a strange coincidence. Note that all three apps launched at the same $2.99 price.

The obvious “what if” question of course is what would have happened had we launched Classics at 99¢. The interesting thing about the paid apps charts is that sales increase almost exponentially with each jump in the top ten, and apps that make it in there tend to hunker down and stabilize for a while. This seemed to be one (very risky) plan for some substantial business while still attempting to chart. The other option is to attempt to cycle back into the charts later with a price drop or heavy advertising. We’re now attempting the former with some of the latter.

We’ve dropped the price for now to 99¢, and we’ll see if the resulting chart climb (if any) warrants this decision. It was a difficult and honestly, personally painful decision to price this low for an app that we truly feel is worth a lot more. But as pragmatists, we know the decision is a realistic one for the situation we’re currently dealing with.

Change

Our proposed “gross revenues rank” solution obviously isn’t one that we can do on our own and will take an effort on Apple’s part, but this isn’t unheard of. Even though Apple appears to move at a snail’s pace, that have actually fixed many of the issues plaguing the App Store in the beginning:

John sent many, many angry letters and made several phone calls to Apple when the free-to-paid exploit was going on. The exploit easily cost us thousands of dollars because we were continually pushed down the ranks by those taking advantage this loophole (for what it’s worth, had our proposed solution been in place, the exploit would have been rendered useless by it).

Even though it felt like John was spinning his wheels by continuously pestering Apple every time he noticed the exploit happening (whether or not it affected our app), he kept the pressure on and it actually resulted in not one, but two responses from Steve Jobs himself. The man. In the legendary terse Steve fashion. No BS.

He first took the opportunity to burn us a bit about the less than stellar reviews and ratings our app was getting but then assured us that change was on the way. Not warm, fuzzy Obama-style, but assurance, nonetheless.

Developers seem to be under the notion that if they challenge Apple they’ll somehow be “punished” for their actions. This makes absolutely no sense in this situation because Apple ubdoubedly wants to have the App Store, like everything else they do, be the best it can possibly be. So if you see something that’s broken, TELL THEM! And this goes not only for developers, but for Apple users in general. The more people, the better.

So call Apple, email them, shout it out on Twitter, blog about it… do your part to help this change if it’s an issue you care about.

tap tap tap is a leading iPhone and iPad app developer and publisher.

We’ve been creating top-notch apps since the App Store first opened. Our apps are used by literally tens of millions of people in all corners of the world. A few of our favorite and most popular apps we’ve created are:

Who linked to this

47 comments

Great article, guys. It’s true what you said: if people don’t try to right a wrong through some kind of action they really have no one to blame but themselves. There have been many great changes to the App Store in the four short months of its existence, so I’m sure there will be plenty more in the months and (hopefully) years ahead. I know I’m definitely excited to see what the future holds!

I think your argument works well for consumer apps. business apps are another issue altogether. We are building a business app and getting ready to release it to Apple. The app integrates with our enterprise web app. We have two potential revenue streams. One from the App Store and one from the recurring revenue using our web app. Salesforce.com uses this model. The question is this: Do I charge a relatively high price on the app store $19.99 and a lower monthly fee or a low price and a higher monthly fee. To use the sales force app you need either an additional $60/month mobile license or a $125 or $175 / month per user Enterprise license. One seat is $2100 and companies pay this gladly.

Marketing for business apps is different as well, so I think position in the App store is irrelevant. But then again I could be wrong.

To be completely honest, I’m not sure I agree with your reasoning here. Comparing the box office and iPhone apps are two very different things. Movie ticket prices are pretty well ubiquitous, and box office revenues definitely do not denote quality in any way. Plus you’ve said yourself that iPhone app buying is done on impulse. Are you going to price a quality app high and expect an impulse buy? No. Unless Apple decided that all apps be priced identically, this model wouldn’t work. And even if they did, some half decent marketing could boost a crap app above a good one. I think what developers have to do here is except that market forces rule, look at what’s popular and learn from it. That’s the way the world works folks!

Justin, I agree that our proposed solution would not fix everything. (For one, the iTunes Store browsing experience is not particularly well suited for finding apps.)

However, it would certainly help higher quality, more expensive applications make a dent into the charts (which remain the only possible source of major exposure for most iPhone developers), evening the playing field a bit and maybe even encouraging an application’s price to more accurately value the product.

I agree that the chart should be listed gross revenue. It would benefit Apple (more revenue), benefit developers (avoid the .99 dilemma) and consumers (which might find better apps more easily). Additionally, because Apple controls the chart algorithm, they could make this shift progressively, until the right balance is found.

How to keep the App Store from becoming the Crap Store? How about preventing a developer from making apps for the iPhone before they issue a single update for their desktop Mac software apps that people paid good money for, in some cases left waiting for two-years-running.

- You are literally bawling to Apple that your applications aren’t selling. The fact that you think you can charge more for these apps and still sell as many is ridiculous. Let me dissects what your “high quality” apps do.

Where To? does one thing, it opens up Google Maps and enters the term you picked as a search field. Gee like if I want to find where the closest hospital was, I would be too stupid to type in “Hospital” in Google maps myself.

On to Classics. I’ll admit the interface is pleasing, I concede that. I certainly wish all apps could look this good, but do I really want to spend 2.99 on a useless app? I mean these book are FREE which means publishing you don’t pay a dime to the writers, and who the hell wants to read a bunch of old books on a iphone? If I really wanted to read any one of these books, I’d get the actual book. Shoot the fact that you made $60,000 off this app (in a week) should leave yourselves satisfied.

The fact that you are now lowering you’re prices because you slid off is a slap in the face to anyone who bought the app when it was 2.99. You probably had this planned all along, release the app at higher prices, wait for the media and bloggers cover the release then lower the price to stay on the charts. Why don’t you refund the 2 dollars you over charged like Apple did when they lowered iPhone costs? I’ll bet you guys will intend to keep this “sale” in effect if the app climbs up the charts. Dropping the price is back handed move especially when the app came out less than two weeks ago.

This whole notion that the apps at the top of the charts are “crap” is outlandish. Implicating developers aren’t thinking about mobile software and creating mac os x apps is misleading. These apps may be stupid (ie the beer one), but at the end of the day people buy it ( Also there isn’t a beer application for mac out). People wouldn’t continue to buy it if it were crap. A $5.99 game is in the top ten as well too if you haven’t realized.

I’d love to say more, but I don’t want to waste any more time and energy into this.

I dunno… Although I find your blog interesting, I’m starting to think that the “Delicious Generation” is composed of devs that typically sell good looking software that does not offer much than looks and hype. Updates are almost non-existent and once you’ve made your money you’re leaving your users out in the cold.

Also, most of your blog is about money and ranking in the App Store. Nothing much on how to improve your apps or how what they offer compared to other alternatives.

So far, you guys made well over $100K since July. I know a lot went into advertising but why are you complaining? I’m doing pretty well myself, I can live off my apps but I work my ass off every day to push bug fixes and new features to my apps so my customers know that I’m listening to them and that I intend to back my products.

The reason your apps do well is because you’re good at marketing. After the buzz wears down and people find out that they’ve spent 2.99$ on a shiny interface with not that much under the hood, they become bitter.

I appreciate your openness about your experience with the Apps store. I’m about to launch my own app and am doing this completely on my own in South Dakota…where we can’t even get an iPhone. So the insight is priceless.

I purchased your app. Mainly to play with the UI and discover usability advances. The designers did a fantastic job and I’m extremely envious of their talents. But the books aren’t for me which may be one reason for the listing fall.

Pricing any product is tricky business. Reading about your experience has given me some idea what to expect. Thank you again for taking time to share with everyone. Best of luck and don’t forget be grateful for all you gained so far.

Did you miss the fact that just yesterday Classics was updated? When Where To and Tipulator were under our control (which they’re now not), we put out *several* updates so I have no idea what your issue is.

And for you to imply that we’re not “working our asses off” like you is pretty ridiculous. I often spend upwards of 16 hours per day working on my businesses (with plenty of all-nighters thrown into the mix). Similar goes for other members of the team. We’ve worked *very* hard to achieve what we’ve done so far and we’ll continue to do so on existing and upcoming apps.

Your comment about our users being bitter seems like complete projection on your part… take a look at the ratings on Classics and you’ll see that it’s currently got 4.5 stars on 127 reviews. That to me sounds like exactly the opposite of bitter customers.

I am also an iPhone dev, and I love your ideas here. It seems like such a simple solution. Devs wouldn’t have to keep undercutting each other. It certainly doesn’t sound like crying to Apple. This is what money we have to live off, and it just so happens that a lot is controlled by Apple. Because it takes drastic action to catch their attention is just an unfortunate detail.

What emails and phone numbers would you recommend contacting? Who would you expect to have the most power in an issue like this?

Also, I bought Classics and loved it. I haven’t read a book in a while, but loved reading Flatland. It is very convenient to be able to read wherever you go. I think I am going to try Hound of the Baskervilles next.

Certainly the iTunes Store was never designed for variable pricing. All songs, movies, and TV shows are more or less equal in value. But it doesn’t work for apps, which can range from $0.99 to $999.

A pricing tier as suggested would definitely let apps with the most fair prices profit. Total App Store revenue would grow. And it would mirror a free market more closely - something that everyone should want.

The App Store is still in its infancy, yes. But if you think larger developers are attracted to playing market limbo with hobbyists, think again. Useful, polished, business applications on your iPhone? Won’t happen. That idea of the iPhone becoming a competitive gaming device? Gone. If you care about the iPhone, you’ll want this to happen.

I understand that you guys think your app is worth more than $.99. But I’ve been seeing all these articles about iphone developers making hundreds of thousands in a months time. I wish I had programing skills to get in on this but I don’t. You should be happy with what you are making, I’m sure you’ve made quite a pretty penny. Just be happy this platform is out there and you’ve profited greatly from it. By the way after reading the majority of this article I searched for your classics app and saw it was only $.99. I did purchase it, but wouldn’t have if it was more than $.99.

I was surprised to see this incredible amount of pressure on prices in the app store. I was brought up I guess on handango.com and the prices back in the early days of when I was using palm devices were a LOT higher ($12 was considered a bargain). I read a lot of ‘reviews’ and am amazed at how many say things like ‘should be free’….. people are so ‘tight’ - and I think it’s just because they keep buying so MANY apps that they want the price to be virtually nil. I myself have now learned to be patient and WAIT when an app comes out that I’m keen.

I wish more than anything that Apple would organize the whole shop better - it’s a mess - the categories are useless - it almost seems random as to what category an app has been plopped into. Surely there can’t be some web 2.0 tagging kind of system to enable more efficient browsing?

I also wish for more quality control. Why do we have to wade through 400 apps that do exactly the same thing…. and if we do surely they can all be grouped together in sub categories with some sort of comparison feature?

Enough griping I still divulge far too much pleasure from my iphone so should be quiet :-))

One thing you haven’t mentioned: The AppStore should offer trial versions (at the developer’s discretion). This would make it a lot easier to spend $10, $20, $30 on an app that is worth it. I know there are “lite” versions for several apps, but this work-around is just not as drop-dead simple as an official solution by Apple could be and therefore is only appreciated by a (small) fraction of customers.

The AppStore should be more than “hit-driven”. Apple has to cultivate the market outside the top 100 not just for apps that are higher quality but also for niche apps — and finally to avoid abandonware.

Regarding Classics: Your app is severely limited by the selection of content you offer. For most buyers who don’t happen do be interested in one of the few books you offer it cannot be more than a toy that they will never touch again, so $.99, after the initial rush, seems to be a reasonable price. When I read “introductory pricing” in the Classics description after launch I assumed that you were planning to raise the price as more books are being added. Honestly, will you ever add more books at this low price or can Classics be considered end-of-life soon? What is your upgrade policy? I always felt that you should have gone with the $.99 per book pricing that is common on the store now and I still think you should go that way.

The $2.99 argument is a non-starter. Early adopter prices are higher, software devs routinely drop prices. Somewhere a developer knows that in the next 3 months his product will be part of a bundle - will he say so to buyers today? Offer them refunds?

The iTunes Store for Apps is atrocious. It has very poor sorting, does not show what it purports to show (New > Release Date is pretty random) and if you DO have a problem there is not way to report that and also request a refund. One or the other, not both.
Anyone else notice that after a couple of weeks the links on the left to All Paid and All Free disappeared?

I agree about trial versions because apps could then sell at a higher price if desired.

There’s another issue here too, and it’s for those apps that aren’t ever “top” apps. Many developers create apps that aren’t expected to be in the top-10 but that still have significant worth.

Because developers have been trained to focus solely on hits, there’s now a mentality where the shelf-life of all apps is just the time it takes for it to drop off the charts. And I think that’s a terrible way to motivate developers to create long-lasting, ever-useful apps that may not be sexy but are still very useful.

I agree with Ryan. As a developer whose app never reached the top 10, I saw little profit from my app. My app entered the store within the first week and only had 2 direct competitors. My app was priced cheaper and objectively I thought it was the best bang per buck. Since the launch I’ve updated the app 3 times, 1 of which was a major update roughly doubling the functionality while at the same time lowering the price. Seeing little to no sales spike from this update/price drop is very disheartening for a developer.

I think as an indie dev my fate rests with Apple reworking how apps can be discovered in iTunes and more importantly on the devices themselves. Staff Pick is a good start as it offers an alternative top 10 of sorts, why isn’t there something similar on the device?

I agree that the ranking would be better if it wasn’t based solely on “popularity”. I have downloaded many cheap and free apps that I have used only a few times. They are certainly not more useful, or worthy of being more visible and higher ranked just because there was no risk to purchasing them.

I think deletion rates and reviews should play a role in rankings in addition to the sheer number of downloads.

Also, the App Store is terrible when it comes to sorting through the apps and trying to find something that is useful. Apple needs to do some serious work to make apps more findable and reduce the amount of clout that the top 100 list has right now.

Let people find and rate apps without making them think that the “most popular” apps are the only ones that matter.

Cute avatar you gave me. But trolls usually don’t have very good points to back up their arguments. I do. But please, plug your ears, go “blah, blah, blah I can’t hear you” all you want, so long as you’re maybe updating, I dunno, iClip, or AppZapper, or Disco, or releasing ANY MyDreamApp winner, etc.

I’ve been able to turn about a dozen people away from buying anything you’ve put out simply by sending them linsk to the “trail of the dead (apps)” you’ve left behind.

Why chose? We can have it all. More ways to slice data is better and I am confident Apple will create an elegant solution. Apple could add the “gross revenue” option with a simple tab…

Have a bit of patience - Apple will give us what we need. As you pointed out, it is in Apple’s best interest to make the App Store a success.

The profit motivate is what makes the world go ‘round (at least it seems to for now). Yes, you have come up with a useful way to improve the App Store and if implemented it may bring you more profit. But what about just writing a good app that simply pays your rent? In your mind do all “serious” developers desire to be in the #1 spot?

I would much prefer solutions that involve the rating of apps (similar to newegg.com) or “users who liked this also like…” a la Amazon or the more intelligent “related items” suggestions of NetFlix.

The spirit of the iPhoneDevCamp (both years) has been to write great apps and see our platform improve. Making money is nice, but it certainly was not the main motivator behind the BarCamp.

Short version: Let’s come up with ways to find the “best” apps. Maybe some of those are the best for the money. Maybe some are the best in class. Maybe some are overlooked gems. What we seek is a way to see the best. The “how” to figure this out is a fun discussion but should not be reduced to a singular focus on how to make the most cash for the least cost.

Face it, the market is working. If you’ve got recognizable characters or names like Crash Bandicoot, Yahtzee, Tetris, Scrabble, etc. folks are going to be looking your way. If they aren’t looking your way, you give them something that will make them want to, which in this market it looks like that means low cost. If you’ve discovered visibility equals sells, then by all means, do everything (including pricing $0.99 apps) that will get you into the top ten. Think about burgers: some place like Ruby Tuesdays has much better burgers than McDonalds, but McD’s is selling billions at $0.99 versus Tuesdays selling what they do at $10+. I know there’s a thousand things separating the food industry from the software industry, but all you have to recoup is time in development and whatever you spend in marketing (I wonder what iHunt, #3 at $0.99, spends on marketing…) I’m not trying to bust your balls about this blog entry, but if you’re going to play at all, you’ve got to play the game the way the consumers are currently playing. That, or you can take your ball and go home.

I don’t think box-office receipts is that good a measure either. After all, just because you went to a movie, doesn’t mean you liked it.

I’d prefer the iPhone to record which Apps you spend time using. Then people would find that some games are solved in a few hours, while others (such as my new game Tetratile — came out today (Try me!)) will give you hours of fun.

It also would give better recommendations to the user: if you spend most of your time in board games, you are probably interested in another one. If you spend all your time in Fstream, maybe you’d be interested in other internet radio solutions.

You have to mix this with newness so that new applications aren’t penalized.

I agree that your solution would improve the App Store quite a bit. It’s probably the single easiest measure with the largest impact for Apple to take.

But it’s just one piece in the puzzle. IMO, the root of the problem is the bad visibility of quality apps. So, in addition to that I propose to

- split Popularity into Sales Rank (based on gross revenues) and Customer Rating and offer sorting on either one
- change the default sort criterion in iTunes and on the device (genre section) to the Sales Rank instead of the Release Date
- Indicate the rating and number of reviews in the listing page in iTunes as on the device
- offer collaborative filtering or Genius™: “these apps could be interesting for you” based on other customers with similar purchases

Also, to me it looks like the last update date still governs the sort order and not the 1.0 release date. see http://twitpic.com/n23e - these apps are not new by far.

I love the competitive atmosphere of the App Store. There is tremendous downward pressure on prices right now, but markets are never wrong. If games can’t sell for more than a buck, then that means games should cost a buck until product quality and marketing can make a compelling argument otherwise.

The problem is that improved quality and marketing require deeper pockets than most small shops can manage.

A related problem that I don’t see receiving much discussion is the black hole of approval time for Apps and how it discourages marketing. If I can’t rely on the App Store to market my games for me (because of the whole cheap Apps sales ranking thing), then it is up to me to market my Apps to drive customers to my product through some means other than App Store ranking. But it is difficult to schedule an effective marketing program when you can’t reliably estimate how long it will take for your App to be approved, and when it will be posted for sale in the App store.

App store reform is needed but developers shouldn’t expect it will be a magic bullet.

How much does a major label Top 40 Billboard-charting song cost on iTunes? $0.99. How much does an indie punk song created on a shoestring budget cost? $0.99.

Also, the word “crap” is relative. If everyone thought the $0.99 apps in the Top 10 were crap, then would they even be in the Top 10 in the first place?

Ranking apps by revenue is a horrible idea. If it were that way, I Am Rich would have been up there for a few days. Are the top songs or movies sections based on revenue? That’ll confuse all people except app developers.

It looks like the market has created some constraints for us. We must work within them instead of trying to control what we don’t have power over.

I feel like this blog post is only half the story. I believe you did some advertising on Daring Fireball and maybe others? I’d be interested in hearing how that impacted sales and whether advertising period makes any positive impact on sales.

Lets face it the inmates are controlling the exposure but really that’s the way it always is. In this case with itunes it’s more like the room that contains the inmates is much smaller and many apps then get drowned out.

I do have to admit that the figures that have been posted in sales over a few months seem to sound a bit like crying but perhaps if there were some solid numbers given to justify why you think the prices should be raised then maybe some might not question some of what is said. All I heard was we think it should be higher. Why? Because you think it’s prettier? Offers more function? How about manhours though? What does the competition offer compared to it?

I’ll admit that itunes does not do well for providing a means of exposure so people can find certain apps. Consider though the volume. Is it just Mac developers upset about this that possibly have not faced a market like this before?

Lastly consider how the music and movie companies feel about itunes? From what I understand they have no control via itunes to control their sales and exposure. They have less control due to pricing. They do have infrastructures already in place outside of itunes though that allow for them to get exposure. After all of that it seems to me that Apple is not the problem in much of this but that no one has grabbed the bull by the horns and capitalized on building that infrastructure.

This is very new in how this is being done so such an infrastructure will likely take time. This isn’t like selling apps for the Palm, a Mac, or even Windows software. A new way of thinking needs to happen for all of this and perhaps immediate expectations need to be lowered with more forward thinking ideas.

What if apple added a new ranking based on the rating? That would be better. Top 100 free, top 100 paid and a top 100 new (released this week or so)

ALL of them based on ratings instead of value or download count (after all: an app that was released years ago could have a zillion download and the new ones start at zero… even if everybody admits that they are substantialy better)

Reviews must be time-limited and removed after an update… that way old bugs that are solved aren’t ‘there’ anymore.

Actually the stupidest idea of apple is the fact that they ask to rate an app when you remove it… that means (you don’t like it… because you remove it) lower ratings (there will be less positive ratings because apple doesn’t ask you after one month of use to rate ir… which would be fair… because you actually used it for a certain amount of time)

sidenote: price is relative to people… I’m planning an app too and I think that I’m going to charge 2.99… and I don’t care about the numbers… I’m even willing to increase the price and have fewer customers and thus fewer support issues

It seems like this is an issue that plagues the tech industry in general. IMHO undercutting and the desire for monopolistic power is part of why the economy of highly capitalistic nations is collapsing. One would have thought competition would improve quality, but instead there’s so much competition its diluted industries to the point where no one can really make a living wage anymore.

As far as ranking goes, I like your idea but I’d rather see apps listed by user satisfaction (quality) and not sales. This puts small and large developers on the same playing field. With your solution you favor larger developers because you can always create huge sales if you put loads of money on marketing (money that smaller developers don’t have).

I like a lot of the comments I’ve read here but a lot of them are double talk too.

John’s idea of ranking by revenue would indeed change the iTunes store and the quality of the software and the pricing structure. Other’s have talked about how you need to let the “market” decide. This is what Apple said they were going to do when they announced the app store back in March. However, the caveat to that is the market decides based on the environment in which they are buying and selling. So the app store guidelines are producing incentives to drive prices for paid apps to $.99. So in the long run the top apps in the two major categories are $.99 and Free. I hope Apple realizes that isn’t a very good marketplace. Something needs to change.

John suggested revenue as the measure. I think that is a good measure but I don’t believe for a second it should be the only measure. Why? Because it once again makes it easy to “game” the system by large companies who can hide their marketing expenses. Profit would be a better measure but that isn’t possible to track or use to rank. It comes down to incentives.

I’ll offer a few of my own thoughts on how this can be fixed. The solutions are meant to be implemented in order. I don’t believe in a single easy fix for complex business problems.

Solution 1
Make more lists. Staff favorites, popularity, free, best selling, random 25, New in the last week, Quality, revenue, etc.

Apple can just keep coming up with different ways to show us new apps. The problem with this is revenue seems to be tied to just 1 of those lists - so the other lists don’t really matter much.

Solution 2
Change the algorithm of the Top Paid Apps list. This is a pretty generic list right now and it seems (as John pointed out) that it is tied to volume. Changing the algorithm would change the landscape a lot but that isn’t the best solution. The solution would be to make this list algorithm more complicated and a little less biased. This would be done by weighting the various aspects of the store (volume, revenue, customer satisfaction, etc.) and generating a score based on a mix of these criteria. This algorithm changes the store and makes it more difficult for a large company to dominate the store with advertising alone. It will help but they can’t dominate. The same goes for customer satisfaction, while this is a good measure it entirely represent the reason an application deserves to be in the top 50. These aren’t the only criteria and I doubt that you would get it right the first time. This will also create less transparency since the algorithm would probably be secret (knowing Apple). However, it would change the underlying incentives to produce more quality software, allow developers to benefit from higher pricing and popularity, and ultimately help me find higher quality apps in the top 50.

Solution 3
Redesign the store. This should of course help customers discover new apps, music, movies, etc. I think Apple will be creative and use Genius somehow but this is a long term project. Also this only works well if the underlying incentives for producing a high ranking app (song, movie) are fair and can’t easily be cheated ($).

Very good article. As a customer, I would prefer to see apps in the store sorted in 3 ways (previously 2, but your article convinced me of the 3rd): Unit sales, Gross Revenue, and Avg cust rating. Avg cust rating allows for apps that are really good, be they expensive or cheap, to show up somewhere, especially if they are an app that fills a niche need well, but that niche may not be big enough to put them in the top of unit sales or revenue.

I agree with the problem, but not the solution. Why would a consumer care how much you make? Why would your app be ‘better’ because you make more or less money? Or how much it cost you to develop something? Ranking by sales work on ‘evenly priced’ items, like say movies or CDs. Ranking sales on itunes apps really doesn’t tell you anything about the app itself. How about:

- Professional reviews, like movie critics. They could compare like apps and prefer one over another
- Compare yourself to the other guy. If I find 2+ apps that do the same thing, I have no way to compare them. And the $4.99 app never says “We’re better than other apps because”. Maybe you should tell me why you are worth 5x the price. Convince me your app is well worth more money because you do X and Y so much better.

I’m a developer from day 1 and I’m really spoiled too. So I decided to fill iTunes with our garbage cheap apps. After while, I start create tonz of cheap version of similar apps which already exist. Because Apple started iTunes store without mature plans and they did not even protect software by allowing comments from people who did not even download it.

But I’m still making apps because I need quick cash in this economy and I would like to say hello to chicks at a bar like, “Oh, I’m making apps for iPhone. This is an app I created.”

Your argument on changing the top apps metric is somewhat sound from a developers perspective, but the measure of total sales revenue has no relevance to a consumer. Do I purchase MSFT Office because it is the highest revenue product or compare it to Norton Anti-Virus because it too has high revenue? No, revenue has no relevance to me.

The current “problem” for developers is what consumers will call a “bargain” so there is no need to change it. The sad reality (for developers) is that the App Store is doing exactly what Apple wants, creating a fresh supply of interesting apps that brings people back again and again and keeps them interested in their iPhone. Apple likes that you are on the treadmill. The App Store is an online dollar store—you might go in looking for one item, but you come out with four impulse buys.

For consumers, the apps are low risk, but lowering the risk would be better. So, the best improvement the store could make is to use the already existing customer reviews. Reviews take time and effort. If people are willing to write them, there should be a weighting system in each application category to show those apps that best met its purpose through the rating system. There are deeper problems of search, feature comparison, unbiased reviews that need to be handled as well. If Apple doesn’t do it, third party sites will.

I do not usually comment on these “arguments’ but I am developing for the iPhone now and have developed Apps and games dating back to the Commodore 64. I disagree with your theory and I intend to make very high quality ORIGINAL Apps and sell them for $.99. I would rather sell 1000 Apps at $.99 than 20 at $9.99. You have to remember that the majority of people looking at Apps are looking at low priced ones or are waiting for the price to fall. I have been fortunate enough to have owned shopping centers in my life, and my Grandfather taught me the very valuable business practice of keeping the rents low and keeping the centers full. The shopping centers right across the street which had 3 times higher rent than us had one quarter of their center full. Who do you think was making more money? Truly at no offense to you as your graphics are wonderful, but I own “Classics” and only bought it for my wife and ONLY bought it because it was $.99. It is not original and I personally could not care about the “page flipping” graphics when I could (and have) gotten the same content for free with Stanza. I will be very happy if I make several hundreds of thousands of dollars in a very short time as you have, and I will have “original” Apps. Again….Truly no offense to you but Classics is just good graphics and the rest was done for you. Good money for the work I would think. I was going to post this on App Cubby but did not. When I saw another company complaining when they are making hundreds of thousands of dollars I felt compelled to post. In these times of economic disaster we programmers have no right to complain when a high percentage of people have lost everything and live paycheck to paycheck or worse, which is the case for many people. I will feel honored at any money I make in the App store.

Now for my honest comment…..
If you don’t like it why don’t you go and program for the Android or the Crackberry? Why?……Because you cant make any where near the money that you can programming on the iPhone. So….Would you and App Cubby like a little cheese with your whine?

While I agree with a number of your arguments, I think that one of your points is flawed. You assume that a developer must sell their apps at 99 cents to be competitive. I disagree rather strongly with that point.

Much of what is ruining the app store is not the abundance of apps, but the abundance of really shitty apps. It is really pathetic that nearly all of the top paid apps do virtually nothing.

At the same time, there is a huge dearth of useful applications that would justify a ten (or even fifty) dollar price tag. As a user, I would like to see more developers release solid offerings that address an actual need rather than the “99 cent” wonders which currently dominate the app store.

I agree to a point about the quality of the Apps out there. That is why I intend to only put out USEFUL and HIGH QUALITY Apps. I don’t assume that an App has to be $.99 to be competitive but if I put out an App that will bring more of a profit at $.99 than at $5.99 then so be it. I will also be targeting Apps that are wanted but not fulfilled properly in the App Store and making the perfect App of the same.
I do disagree with the whole “crapware” statements though. If someone can make two million dollars on a fart machine, and people will buy that, then so be it. As is the case with the number one App, iFart Mobile. This is a perfect case of what I will do along with making my own HIGH QUALITY, ORIGINAL Apps. iFart was not his idea, Pull My Finger was the original, but he did it BETTER. He is now making a perceived $10,000 a day, or $70,000 a week, or approximately $300,000 a month. If people want that then who are we to say that it is “crap”. One mans crap is another mans fun and laughter. Apple should split the top lists into “crapware” and “non-crapware”. But who are we to deny a person from retiring by making a fart App?

My Apps will sell where they can….I will copy another App if I can make it better, but I will still concentrate on ORIGINAL, HIGH QUALITY, USEFUL Apps.

One thing for sure is when I make a million dollars for my work, I certainly won’t be whining about anything.

My solution is simple… “dynamic pricing”. All apps should start with a 1cent cost per download. As more and more downloads take place, keep auto-increasing the price. So, after say…100 downloads the price goes up to 10cents… next 1000 to 20 cents…. (price slabs / download slabs can be fixed accordingly). This is THE best solution and Mr Jobs needs to look at it. Can you hear me? We run an online iPhone Development and Mobile Development course at EDUmobile.ORG and such a pricing will benefit all our students and the entire developer community in general.

Another thing to consider is, people want to share games with others, but horde cool apps to themselves. It’s like a secret club to have the coolest app, yet games they share to compete. The AppStore killed my app by launching it with 150 others all at once- the only time that’s ever happened. I was counting on customers who browse to see what’s new…
Very tired of the engrish apps and the obvious “entertainment” apps in utillities.
And I’ve stopped even browsing photography because it’s all advertising apps for photographers.
Apple has to fix the app store before we all jump to writing droid or bb apps.
-Corey, creator of iMemoDial, a utillity that isnt a Hand heater or flashlight.